Depreciation on commercial right to use land remanded for fresh factual adjudication, leaving the substantive claim open.

Depreciation under Section 32 on payment made for a commercial right to use land was not finally decided because the factual foundation for the claim had not been properly placed before the lower authorities. The HC noted that the issue arose on the assessee's facts, but the alternate claim had not been canvassed in the requisite form before the Assessing Officer, Commissioner (Appeals), or Tribunal. It therefore remitted the matter to the Assessing Officer for fresh adjudication in accordance with law, leaving the substantive question open for reconsideration on merits.

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Issues: Whether the assessee was entitled to depreciation under Section 32 of the Income-tax Act, 1961, on the amount paid to SEZ for acquiring a commercial right to use land for business purposes.

Analysis: The claim for depreciation was raised as an alternate plea and had not been properly canvassed before the Assessing Officer, the Commissioner (Appeals), or the Tribunal in the requisite factual form. In the absence of a proper foundation on facts, the issue was not decided on merits, though the Court found that a consideration arose in the assessee's case. The appropriate course was to remit the matter to the Assessing Officer for fresh adjudication after considering the assessee's submissions.

Conclusion: The issue was not finally answered on merits and was remitted to the Assessing Officer for decision in accordance with law.

Final Conclusion: The appeal succeeded to the extent of securing a remand, and the substantive question of law was left open for fresh determination by the Assessing Officer.

Ratio Decidendi: A depreciation claim based on a commercial right cannot be finally adjudicated where the necessary factual foundation was not properly placed before the authorities below and the matter requires fresh consideration on merits.

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